The board of Citizens Property Insurance Corp. received a tongue-lashing from lawmakers and homeowners during a Monday workshop in Miami after unveiling a plan to raise rates by an average of 7.5 percent next year.

The proposed statewide rate increase translates to about $173 million in higher costs for Florida homeowners, who have already sustained a barrage of cost increases and coverage reductions this year.

"The decisions you make affect people that you may not think about," said Rep. Carlos Lopez-Cantera, R-Miami, referring to low-income Floridians who have to choose between housing costs and food. "They don't get the opportunity to come (meet) in a nice hotel boardroom and have food delivered to them."

Board members said rate increases are necessary for the state-run insurer as it battles mushrooming sinkhole losses and a growing gap between its prices and premiums in the private sector. Gov. Rick Scott has tasked the board with shrinking the size of Citizens — which insures 1.4 million — and company executives say the high level of risk could endanger Florida's economy if a hurricane hits.

Citizens also unveiled separate filings for sinkhole rates, which are not covered by the state's current 10 percent cap on rate increases. The insurer said sinkhole rates, on average, should be about 263 percent higher in order to cover the amount of risk on the company's books.

For sinkhole coverage in places like Pasco and Hernando counties, Citizens' models indicate homeowners should be paying an average of $4,100 to $9,700 more each year. The board will likely try to phase in those higher costs over time with less aggressive rate hikes.

Barry Gilway, Citizens' new president, said the company subsidizes homeowners by charging rates that are, in some cases, 60 percent less than what the private market charges. Company rate filings indicate that average rates are 15 percent to 27 percent lower than they should be.

"I do believe that we have to move in a measured manner towards closing that gap," Gilway said.

But using insurance industry jargon such as "assessment load," "actuarially unsound" and "risk load," the board struggled to connect with some in the audience.

"My eyes glazed over five minutes into the meeting," said James Curry, a Fort Lauderdale landlord who saw his insurance premiums with Citizens go up 41 percent this year after an inspection.

Curry said he moved from California to Florida because of California's high taxes but is now facing a new set of cost-of-living challenges.

"I thought I solved my problem, but my problem's back," he said. "My insurance costs are almost as high as my property taxes. It's crazy."

Aside from raising rates, Citizens is proposing ways to chip away at coverage, thus reducing its risks. For instance, the insurer wants to place a $15,000 limit on losses caused by various types of water damage. The company said water-related losses such as plumbing leaks represent the top cause of non-catastrophic and non-sinkhole losses it faces.